By Stuart Eustice, Partner and Holly White, Lawyer 

Background

Ms Abha Kumar was a registered nurse and Nurse Unit Manager at a residential aged care facility in East Melbourne. On 3 July 2015 Mr Lionel Cox, aged 92 was admitted for respite care. Mr Cox had no family but had good neighbours. By the time of his admission, he had become frail and dependent. He met Ms Kumar on admission, and she learnt he had no family, owned his home and had not made a will.

On 27 July 2015 Ms Kumar purchased a post office will-kit for Mr Cox and on the same day Mr Cox made a handwritten will naming Ms Kumar as the executor and sole beneficiary. At Ms Kumar’s direction, two staff members witnessed the will without knowing its contents.

Mr Cox passed away on 9 August 2015. Ms Kumar obtained a grant of probate from the Supreme Court and obtained over $1.1 million dollars from the estate.

Case

The Nursing and Midwifery Board of Australia (the Board) applied to VCAT to have Ms Kumar’s nursing registration revoked and were successful (see Nursing and Midwifery Board of Australia v Kumar [2019] VCAT 1099). The Board subsequently applied for a costs order under section 195 of the Health Practitioner Regulation National Law (Victoria) (National Law) or section 109 Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act).

VCAT noted the Board rarely applies for such costs orders, however found it appropriate to order Ms Kumar to pay the Board’s costs in this proceeding under both section 195 of the National Law and section 109 of the VCAT Act.

Section 195 of the National Law confers a discretionary power on VCAT to make a costs order in the following terms:

Costs

The responsible tribunal may make an order about costs it considers appropriate for the proceedings.

Section 109 of the VCAT Act relevantly provides that at all times, each party is to bear their own costs in the proceeding, however, at any time, the Tribunal may make an order that a party pay all, or a specified part of the costs of another party in the proceeding. Such an order is subject to consideration as to:

1. whether one party has conducted the proceeding in a way that unnecessarily disadvantages the other party;
2. whether a party has been responsible for prolonging unreasonably the time taken to complete the proceeding;
3. the nature and complexity of the proceeding; and
4. any other matter that the Tribunal considers relevant.

Ms Kumar submitted that costs are not routinely awarded at VCAT in disciplinary proceedings under the National Law, however the Tribunal noted that this is simply because “costs are not routinely asked or by either of the parties. VCAT does not have a practice of declining to order costs. For whatever reason, it has rarely been asked to exercise the discretion given to it by s 109, and this is the first time it has been asked to award costs under s 195”.[1]

The Tribunal pointed to several factors which supported their finding to award costs, including:

1. the proceedings were complex and costly, which “would in our view make it fair to award costs even if no other factors did so”; [2]
2. the proceedings exposed serious wrongdoings that would have otherwise remained hidden;
3. the proceedings had led to necessarily high costs for the Board which would otherwise be paid by public funds;
4. Ms Kumar had enriched herself of over $1 million – a benefit retained against ethical obligations;
5. the proceedings vindicated concerns and honesty of staff involved who experienced distress and discomfort in doing what Ms Kumar asked; and
6. the National Law expressly allowed a costs order to be made if appropriate.

Conclusion

Historically, it has been rare for costs orders to be made by VCAT in health practitioner disciplinary cases. However, as this case highlights, this is due to a Board rarely applying for costs, rather than an unwillingness on behalf of the Tribunal to make such orders.

Insurers should be aware that as a result of this case, Medical Boards may be more inclined to seek an order for costs in VCAT.

[1] Nursing and Midwifery Board of Australia v Kumar (Review and Regulation) (Costs) [2020] VCAT 1038, 70.

[2] Ibid, 68.